Aurora Empowerment Systems and its attorney knew all along that the company was not financially able to acquire the shares required to obtain possession of the assets at the deeply troubled Orkney and Grootvlei gold mines, Pamodzi Gold liquidator Johan Engelbrecht said in an affidavit.
“Their so-called funding model was nothing but a smokescreen,” Engelbrecht said in an affidavit submitted to the North Gauteng High Court.
Engelbrecht, who addressed the mineral resources portfolio committee this week, reported earlier that the liquidators had laid criminal charges against Aurora director Zondwa Mandela, former president Nelson Mandela’s grandson; and Ahmed Amod, a lawyer for Aurora.
He reported in the affidavit that Aurora, represented by Mandela, entered into an agreement with the liquidators of the Pamodzi group of companies in terms of which Aurora was handed possession of the Orkney and Grootvlei mining assets in October 2009.
Aurora had alleged that as part of the financing of the purchase of the mine assets, it had received the necessary funding from a Malaysian company known only to the liquidators as AM Capital. The liquidators were told that the “funding method” involved the acquisition by Aurora of shares in a JSE-listed company, Labat.
Within months – February 2010 – Aurora had failed to make payment of outstanding salaries of mineworkers, resulting in a general strike. Mine operations stopped.
At that point, the provisional liquidators became “increasingly concerned” that Aurora did not have the necessary funding “as they alleged in the bid document”.
“It is important to note that during February 2010 to March 2010 the… liquidators had the right to cancel [the deal] but did not do so, on the strength of fraudulent misrepresentations made to them by Aurora.”
Aurora claimed to have paid for the Labat shares. This was confirmed by Amod Attorneys, which told the JSE Securities Regulation Panel that Aurora had paid R5.3 million into its trust account.
Amod’s letter was a requirement in order for the transaction between Aurora and Labat to be concluded. The liquidators asked Amod to provide it with copies of his trust ledger, copies of his trust banking account and documents providing proof of the payment. It was only in March this year – two years later – that Amod acknowledged that two cheques signed by Mandela had been stopped. Amod had, allegedly, made representation in March 2010 that he was in receipt of the funds from Aurora.
Approached for comment, Amod said he was no longer dealing with the Aurora matter and it was sub judice anyway.
Sapa reports that expelled ANC Youth League leader Julius Malema told Aurora mineworkers at Groovlei yesterday that “we are going to lead a mining revolution in this country… We will [make] these mines ungovernable until the Boers come to the table”.
He claimed politicians were being paid off in shares to protect white mine owners.